H&E Equipment Services Inc (HEES) Q3 2024 Earnings Call Highlights: Navigating Revenue ...

GuruFocus.com10-30

Total Revenue: $384.9 million, down 4% year-over-year. Equipment Rental Revenue: $288.1 million, up 2.8% year-over-year. Sales of Rental Equipment: $27.8 million, down nearly 50% year-over-year. Gross...

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}\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nH&E Equipment Services Inc (HEES) Q3 2024 Earnings Call Highlights: Navigating Revenue ...\n</h2>\n\n<h4 class=\"meta\">\n\n\n2024-10-30 15:10 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://finance.yahoo.com/news/h-e-equipment-services-inc-071046983.html><strong>GuruFocus.com</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>Total Revenue: $384.9 million, down 4% year-over-year.\nEquipment Rental Revenue: $288.1 million, up 2.8% year-over-year.\nSales of Rental Equipment: $27.8 million, down nearly 50% year-over-year.\nGross...</p>\n\n<a href=\"https://finance.yahoo.com/news/h-e-equipment-services-inc-071046983.html\">Source Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","isBrief":false,"type":0,"news_type":1,"symbol":"HEES","symbol_name":"HE设备服务","start_time":0,"source_url":"https://finance.yahoo.com/news/h-e-equipment-services-inc-071046983.html","article_id":"2479240757","we_media_id":null,"thumbnails":[],"rights":null,"url":"https://stock-news.laohu8.com/highlight/detail?id=2479240757","pubTimestamp":1730272246,"sourceInfo":{"source_id":"yahoofinance","name":"雅虎金融"},"weMediaInfo":null,"summary":"Equipment Rental Revenue: $288.1 million, up 2.8% year-over-year.Sales of Rental Equipment: $27.8 million, down nearly 50% year-over-year.Gross Margin: 44.5%, compared to 47% in the prior year.Rental Gross Margin: 51.2%, down 210 basis points year-over-year.Net Income: $31.1 million or $0.85 per diluted share.Fleet Size : Just below $3 billion, up 8.1% year-over-year.Physical Utilization: 67.6%, down 240 basis points year-over-year.Branch Expansion: 27 new locations added since Q3 2023.Dividend: $0.275 per share of common stock paid in Q3 2024.GuruFocus has detected 4 Warning Signs with HEES.H&E Equipment Services Inc  reported a 3.3% increase in total equipment rental revenues for the third quarter, driven by the addition of 27 new locations since the previous year.H&E Equipment Services Inc  expanded its operational presence significantly, with a 54% increase in branch count since the end of 2021.A: Bradley Barber, CEO, explained that the decline in rental rates is entirely due to th","collect":0,"end_time":0,"defaultTopTitle":"yahoo.com","property":["earning"],"viewcount":null,"language":"en","relate_stocks":{"HEES":"HE设备服务"},"translate_title":"H&E Equipment Services Inc(HEES)2024年第三季度收益看涨期权亮点：导航收入...","themeId":null,"isJumpTheme":false,"ttsUrl":null,"symbols_score_info":{"HEES":1},"content_text":"Total Revenue: $384.9 million, down 4% year-over-year.\nEquipment Rental Revenue: $288.1 million, up 2.8% year-over-year.\nSales of Rental Equipment: $27.8 million, down nearly 50% year-over-year.\nGross Profit: $171.5 million, down 9% year-over-year.\nGross Margin: 44.5%, compared to 47% in the prior year.\nRental Gross Margin: 51.2%, down 210 basis points year-over-year.\nNet Income: $31.1 million or $0.85 per diluted share.\nAdjusted EBITDA: $175.3 million, down 8.4% year-over-year.\nSG&A Expense: $112.4 million, up 7.9% year-over-year.\nFleet Size (OEC): Just below $3 billion, up 8.1% year-over-year.\nPhysical Utilization: 67.6%, down 240 basis points year-over-year.\nAverage Rental Rates: Declined 0.1% year-over-year.\nBranch Expansion: 27 new locations added since Q3 2023.\nFree Cash Flow Used: $56 million for the nine months ended September 30, 2024.\nDividend: $0.275 per share of common stock paid in Q3 2024.\n\n\nWarning! GuruFocus has detected 4 Warning Signs with HEES.\n\nRelease Date: October 29, 2024\nFor the complete transcript of the earnings call, please refer to the full earnings call transcript.\n Positive Points \n\nH&E Equipment Services Inc (NASDAQ:HEES) reported a 3.3% increase in total equipment rental revenues for the third quarter, driven by the addition of 27 new locations since the previous year.\nThe company achieved strong margins on the sales of rental equipment, exceeding 60% in the quarter.\nH&E Equipment Services Inc (NASDAQ:HEES) expanded its operational presence significantly, with a 54% increase in branch count since the end of 2021.\nThe company has a robust pipeline of megaprojects, which are expected to drive future growth and provide premium utilization metrics.\nH&E Equipment Services Inc (NASDAQ:HEES) maintained a solid capital structure with a net leverage ratio of 2.2 times and no debt maturities before December 2028.\n\n Negative Points \n\nTotal revenues for the third quarter declined by 4% compared to the same period last year, primarily due to a significant reduction in sales of rental equipment.\nPhysical utilization declined by 240 basis points to 67.6%, reflecting lower project activity and some impact from new branch locations.\nRental gross margins decreased by 210 basis points from the previous year, largely due to a decline in physical utilization and rental rates.\nThe company faced higher SG&A expenses, which increased by 7.9% due to branch expansion initiatives.\nNet income for the third quarter was $31.1 million, a decline from $48.9 million in the same quarter of the previous year.\n\n Q & A Highlights \nQ: Can you clarify the impact of megaprojects on rental rates and expectations for Q4? A: Bradley Barber, CEO, explained that the decline in rental rates is entirely due to the shift towards megaprojects, which offer longer durations but lower rates. There is no price degradation in local markets, and some small gains are still observed. The expectation is for rates to remain stable with potential for improvement in 2025 as interest rates ease and local projects become more viable.\nQ: How is the competitive landscape for megaprojects, and is there a need to limit exposure? A: Bradley Barber, CEO, stated that the competitive environment remains stable with no increased aggression in pricing. The company is selective in pursuing megaprojects, focusing on those close to existing facilities and considering factors like geography and customer relationships.\nQ: How does the current demand environment affect your growth strategy for new locations? A: Bradley Barber, CEO, mentioned that despite the sluggish demand, the company plans to continue opening 12 to 18 new locations annually. These expansions are seen as long-term investments in high-growth markets, and the strategy will only be adjusted if there is a significant downturn.\nQ: What are your initial thoughts on capital expenditure for 2025? A: Bradley Barber, CEO, indicated that while the company is still finalizing its budget, the focus will be on replacement capital for the remainder of 2024. The plan for 2025 includes opening new locations, and the company is seeing better pricing from manufacturers, which may influence capital decisions.\nQ: Can you comment on the trend in used equipment sales and margins? A: John Engquist, President and COO, noted that used equipment sales have decreased due to a younger fleet age and softening auction values. However, the company expects to maintain margins above 50%, although achieving 60% may be challenging.\nFor the complete transcript of the earnings call, please refer to the full earnings call transcript.This article first appeared on \nGuruFocus.","kind":"highlight","is_publish_news":true,"is_publish_highlight":false,"is_publish_live":false,"is_publish_wemedia":null,"editions":null,"column":"","sentiment":"0","news_tag":"","news_rank":0,"symbols":[],"gpt_button":1},"commentList":[],"isCommentEnd":true,"newsSizeData":{"likeSize":0,"commentSize":0,"repostSize":0,"favoriteSize":0,"likeStatus":false,"favoriteStatus":false},"APP":{"userAgent":"Mozilla/5.0 AppleWebKit/537.36 (KHTML, like Gecko; compatible; ClaudeBot/1.0; +claudebot@anthropic.com)","isDev":false,"isTTM":true,"deviceId":"web-server-community-laohu8-v3","version":"4.29.3","shortVersion":"4.29.3","platform":"web","vendor":"web","appName":"ttm","isIOS":false,"isAndroid":false,"isTiger":false,"isTHS":false,"isWeiXin":false,"isWeiXinMini":false,"isWeiBo":false,"isQQ":false,"isBaiduSwan":false,"isBaiduBox":false,"isDingTalk":false,"isToutiao":false,"isOnePlus":false,"isHuaWei":false,"isXiaomi":false,"isXiaomiWebView":false,"isOppo":false,"isVivo":false,"isSamsung":false,"isMobile":false},"href":"/m/news/2479240757"}